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Medicaid Expansion? Probably Not This Year, Panel Concludes

A gathering in Winston-Salem drew more than a hundred people to hear perspectives on adding up to a half-million beneficiaries to the state and federally funded program.

By Rose Hoban

Despite difficult travel conditions, about 150 people gathered in Winston-Salem Monday evening to participate in a discussion of Medicaid expansion.

Students, industry experts and community members packed an amphitheater at the Wake Forest University School of Law to hear a five-person panel give the pros and cons of broadening eligibility to the state and federally funded program that provides health care to about 1.9 million North Carolinians.

North Carolina Health News was a media sponsor of the event.

After WFU Provost Rogan Kersh laid out the basics of the state’s Medicaid program [see box], Rep. Donny Lambeth (R-Winston-Salem) presented numbers showing that the $1.22 billion increase in the state’s Medicaid budget has been the source of more than half the growth in the overall state budget since 2010.

Lambeth, who spent four decades working in health care administration and was the president of Wake Forest Baptist Hospital before retiring, was one of the lead negotiators of the Medicaid reform deal struck in the General Assembly last fall.

He said there was some discussion in Raleigh about expanding Medicaid, which is allowed for under the federal Affordable Care Act.

But Lambeth said that with a complicated Medicaid reform process just getting underway, there’s little chance of expansion getting through the General Assembly in this year’s short legislative session, which begins in late April.

Despite snowy conditions outside, a large classroom at Wake Forest University was filled Monday night for a forum on Medicaid expansion. Photo credit: Rose Hoban

The case for expansion

According to Janet Hoy, president of the League of Women Voters of Orange, Durham and Chatham Counties, expanding Medicaid to include up to 500,000 more North Carolinians would be an economic win for the state. She made the point that tax dollars are flowing from North Carolina to the federal government and then to the 31 states (and the District of Columbia) that have expanded their Medicaid programs.

Quoting a study produced by the Kate B Reynolds Trust and the Cone Health Foundation in late 2014, Hoy said that up to 43,000 jobs would be generated by the additional income for hospitals, clinics and doctors. She also said the expansion would generate billions in taxable economic activity and bring $864 million in new state revenue.

“These are largely health care jobs, but also other jobs that pay above the median household income,” she said.

Hoy said Medicaid expansion would create more than 2,000 jobs in Forsyth County alone and would cover about 13,000 people who now make too much to qualify for Medicaid but not enough to receive federal subsidies on the health care marketplace.

“Medicaid expansion is an economic imperative because it would bring us so many dollars, so many jobs and additional revenues into our state,” she concluded.

The case against expansion

Wake Forest University freshman Adam Tomasi asked about some seeming contradictions in the role of the free market in Medicaid reform. Behind him, Greensboro resident Heather Stinson asked whether providers had been consulted in the reform and expansion planning. Stinson’s husband is a family physician who left general practice, in part because of low Medicaid reimbursements. Photo credit: Rose Hoban

Katherine Restrepo from the conservative John Locke Foundation raised the specter of patients going without treatment should the state expand.

She told the story of Deamonte Driver, a 12-year-old from Maryland who died in 2007 as the result of complications from tooth abscesses. His mother was unable to find timely dental care for her son because few dentists in Maryland would treat a Medicaid patient.

Restrepo cited a lack of health care providers in North Carolina – most particularly, in rural areas.

“When people talk about health coverage and access to care, people use them interchangeably. But in fact, they’re two different concepts,” she said.

Simply giving people Medicaid coverage would not solve all their health care issues, Restrepo asserted.

“From a financial perspective, Medicaid expansion is tempting for states to accept,” she said, noting that the federal government covers all the costs for the first three years; then, starting in 2022, states will cover 10 percent of the costs with the federal government picking up the rest.

“The reality is that this influx of federal funds is really adding to the federal deficit the way the Affordable Care Act drew up Medicaid expansion,” she said. “So it’s sort of a misperception to think that … our state dollars are going to fund somebody else’s Medicaid expansion.

“If a state wants to expand Medicaid, it’s just adding onto the federal deficit.”

Reform process as roadblock

But it’s logistics that will probably prevent Medicaid from being expanded this year, said Michael Parkerson, chief strategist for Blue Cross and Blue Shield of North Carolina, which supports expansion of the program.

“None of us should be happy about the fact that North Carolina tax dollars are going to the federal government and being dispersed to other states,” he said. “We’ve lost out on over a billion dollars a year.”

Lambeth said he agreed for the most part with Hoy’s assessment of what expansion could bring.

“From my background as a hospital administrator, I see the provider’s perspective; I see the advantages of expansion. And then from my heart perspective, I certainly see the advantage of having those people with some kind of health care,” he said.

But as Medicaid reform rolls out in North Carolina over the next four years, he said, something has to be done to address shortfalls in provider rates.

Rep. Donny Lambeth (R-Winston-Salem) listens to an audience member after the panel. Photo credit: Elizabeth Page

“You can’t balance the state budget on reductions to providers, and that’s the only strategy we have right now until 2020,” he said in an interview after the panel discussion.

Lambeth said he thought many House members would be open to expansion – and the electorate, it seems, would be with them. A new poll released today by Public Policy Polling shows a majority of independents and Republicans believe the state should expand.

The more significant roadblock is in the Senate, he said.

This year’s electoral politics could also throw in several wildcards.

“What if [Gov. Pat] McCrory isn’t re-elected, and then there’s a new health secretary?” Lambeth asked.” You have a new secretary with a new learning curve and there’s going to be new people in all of a sudden.

“Even if we keep saying we’re going this new route, it ain’t going as fast.”